IKEA: the use of megafactories for a global production

IKEA, the multinational company known for furnishing products sold around the world, was founded in Sweden in 1943. The name IKEA is an acronym of the founder Ingvar Kamprad and Elmtaryd and Agunnaryd, respectively, the cottage and the village Swedish in which he grew up. Starting to sell everyday items such as pens, matches, watches, bags of seeds and decorations, Kamprad, just 17 ​​years old, decided to invest the amount of money given to him by his father as a reward for the study, to give life to their own business . However, it is only in 1950 that he bought his first furniture factory for sale and become a customer of small furniture factories in the area in which he lives, and in 1951 was created and published its first catalog. The basic idea is to ship to you unassembled furniture but rather all be dialed automatically. In this step for Kamprad to sell at a very low price is possible, delivering products directly to customers at home. The first shop was opened in 1958 to Älmhult, in Sweden, where three years before it is transferred to the central office. From this moment on, IKEA switches from buying and selling furniture and home furnishings to produce them exclusively, focusing on the development of a design all its own. 1965 was an important year since it was inaugurated in Stockholm, the market of about 6,000 m2, similar to a large traditional market, an environment that still exists today and where you can buy lamps, picture frames, posters, children’s items , order items for home, kitchen tools, glass, porcelain, carpets, green, fabrics, bed linen and towels.

Today, IKEA, extends globally with its 345 sales centers with a turnover in 2013, which is around 29,2 billion Euros. Every year about 500 million customers a year visit the shops of the company that is leader in its sector, operates a network of approximately 1,000 suppliers in 55 countries spread.

When it comes to IKEA refers inevitably to the concept of “integration” means all IKEA products are developed and designed on the basis of production, logistics, storage and trade. The core business units are the backbone of the organization are in fact IKEA:

• Production / Supply

• Distribution / Logistics

• Sale

So what is the winning strategy of the giant IKEA? According to Porter, the ultimate goal of strategy is to achieve a high return on investment. The focus is the creation of economic value, profitability, and this can only happen if you are able to create the conditions to be able to make a lasting difference in the long run. If, therefore, it is fair to say that you have a strategy when you choose to compete in a different way than its competitors because it is designed to be unique, IKEA there is certainly succeeding. The goal, to IKEA, you hit the target customers are particularly sensitive to the price they want, that is, to buy products at an affordable price without sacrificing style, functionality and quality. They are students, young people, families to whom IKEA asks you to choose your own, personally deliver products to purchase and engage themselves in the assembly of the various components and modules. And for customers who want the product ready for use, IKEA, with an additional charge, has at its disposal a specialized staff ready to make the requested service.

The production globally has made possible the rapid widespread dissemination of the products in all countries of the world in record time, thanks to the use of megafactories and 5 huge plants located in Europe. In Poland hosts the largest facility that deals entirely of wood production: are produced each year some 30 million cabinets, desks and chairs. The prototypes of each item to arise Älmhult, headquarters, where they are manufactured kitchen cabinets. If to achieve certain categories of products you can rely on automation mechanized pushing, others require manual work of human operators. Just think of the classic production of the Ektorp sofa with removable cover: highly skilled staff of the department is concerned with textile cut, sew and adhere the tissue very precisely. Same goes for the production of the chairs. Selma, the armchair “book” combines ergonomics, aesthetics and functional design with the ability to “browse” literally back seat and getting a funny image composition.

The quality of IKEA products is guaranteed thanks to the testing of all products manufactured that occurs at the largest plant located near Älmhult. Here 22 laboratory technicians perform tests up to about 50,000 a year, to test endurance, strength and durability of new and old. What matters is simulate situations as realistic as possible through the use of robots. For example, for the production of the sofa Ektorp, presses metallic exert pressures which, simulating the repeated action of a human being who sits and stands, in two days, repeating for approximately 50,000 times. In this way, the flexibility is tested, the padding, making sure that there are no failures of any kind and that the comfort of the sofa remains for a long period of time. There also ensures that the polyurethane that constitutes the padding of the sofas has a high resistance to flames. The verification, in this case, takes into account three main factors: the time to spread the flames, the final weight of the sofa and the time of extinction of the fire. Depending on the results obtained it can be said if the test is positive or not.

The proper management of supplier relationships is, without a doubt, one of the distinctive capabilities of IKEA perspective of a Global Sourcing focused on continuous monitoring of the supply market, sull’instaurarsi interaction constants with suppliers, with the maintenance of contacts with potential suppliers and the evaluation of suppliers.